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Does Postmedia need paywalls or headstones

In his NY Times blog, economist Paul Krugman focused attention on one of the frequently repugnant think-tanks that serves America’s one-percenters. In Denial In Depth, Krugman applauds Ryan Chittum at the Columbia Journalism Review for:

…a takedown of a “study” from American Enterprise Institute purporting to show that inequality hasn’t increased, after all. What’s striking is the way AEI doesn’t even resort to the usual practice of concocting misleading numbers; it just flat-out lies about what various other peoples’ research, like Robert Gordon’s work, actually says.

What I found myself thinking about, however, is the way the inequality debate illustrates some typical features of many debates these days: the way the right has a sort of multi-layer defense in depth, which involves not only denying facts but then, in a pinch, denying the fact that you denied those facts… You might ask, how is it possible to take such mutually contradictory positions? And the answer is, it’s very easy if confusing the debate is your job.

One might argue the four traditional estates of the realm — clergy, nobility, commoners and news media — may now be joined by a fifth: think tanks. In most cases though, these policy institutes are agents of the second estate, the nobility. If one examines the most influential of the thousands of think tanks spread throughout the western world, they are mostly financed by and serving one-percenters.

Professional ideologues have become particularly influential today as media organizations deemphasize news gathering in favour of uncritical echoing of material from outside organizations, even those with ulterior motives. Placement of commercially or philosophically beneficial content is aided through financial rewards to journalists and editors, often in forms designed to appear unconnected.

There are hidden costs for publishers though. When readers believe journals reflect an exclusive point of view, part of the potential audience walks away. The missing part would be most engaged too; people who enjoy stimulation from honest intellectual conflict. Few daily newspapers in Canada welcome or even tolerate diverse opinions. They serve as journals of business and that means large enterprise, not the widespread small businesses.

Yet, ultimately, newspapers need ordinary folk as readers. Paul Godfrey, head of Postmedia, while announcing more financial losses and continuing declines in readership and advertising, says that paywalls are the solution. He points to the New York Times success in building revenues from digital content. Without loyal readers, that comparison is little more than stargazing. The NYT and a handful of other great or near great papers might pull a paying digital audience but it won’t happen with second rate fishwraps like Postmedia publishes in Canada’s major cities.

1. Canwest creditor group bought the newspaper assets in July 2010 for $1.1 billion including $950 in cash.2. Postmedia lists on the TSX as PNC.A and PNC.B to meet Canadian ownership rules. Usually a company would have an initial public offering (IPO) in which new money would be investing in the company. This did not happen. Today the market capitalization of PNC.A is $363 million or about 33% of the $1.1 billion paid for the company a year and a half ago.3. The company is highly indebted. Debt/Equity of 3:1.4. The company continues to lose money.5. Even if they can generate $50 million in additional revenue from pay walls it will not be enough to turn the company around.6. Ironically some of those most shrill about the primacy of business over government may end up with a tiny government pension if the company goes bankrupt (again) and liquidated.

“The NYT and a handful of other great or near great papers might pull a paying digital audience but it won't happen with second rate fishwraps like Postmedia publishes in Canada's major cities.“

Well said Norm. BTW, even the NYT, which is a whole nother species than the Postmedia fishwrap hasn't had an easy time of trying to monetize web content! For Post(as in after)Media, any kind of paywall is just another of so many reasons to simply ignore their nonsense entirely!

Postmedia should look at the whole NYT paywall story. It cost $40 million for them to come up with their custom paywall. You can do it for cheaper than that, but if you do it wrong, you just alienate your readers and lose even MORE revenue.

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Freelance reporter Bob Mackin wrote that BC’s Legislature was a scandal waiting to happen and he quoted journalism professor and former Legislative reporter Sean Holman about the significant potential for abuse. Mackin blames excessive secrecy and lack of transparency...

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